Can One Email Lose You a Contract?

December 6, 2017

by Shelley Hall

A recent protest – Bluehorse Corp., B-414809 (Aug. 18, 2017) – involved an acquisition diesel fuel, which was as part of a highway construction project by the Department of Interior, Bureau of Indian Affairs (BIA).

The solicitation said that the fuel would be delivered “as needed” by the construction project. During a question-and-answer session, the CO stated that BIA had two 5,000-gallon tanks for storage, and that the agency “typically” orders 4,000 gallons at a time.

Bluehorse Corp., an Indian Small Business Economic Enterprise, provided a quotation that said it had the ability to supply 7,500 gallons per delivery.

The CO selected Bluehorse for award. After award, the government sent them a purchase order which specified that each delivery would be 4,000 gallons. The purchase order incorrectly stated that the capacity of the tanks was 4,000 gallons each versus 5,000.

Bluehorse and the CO spent the day emailing back and forth about the parameters of the deal. Bluehorse insisted they should be allowed to deliver 7,500 gallons at a time. The emails escalated from a request that the government clarify the capacity of its tanks to a threat that “if you don’t amend, we will protest.” The one problem was that in one of the emails, Bluehorse said “our offer was made on the ability to make a 7500 gallon drop .  . .”

The CO responded that Bluehorse was trying to craft its own terms by “determining the amount you want to deliver and not what the government is requesting.”

When Bluehorse did not respond, the CO rescinded the offer. In one single day, the deal had fallen apart. Bluehorse protested, saying that the agency relied on “unstated evaluation criteria” and “inexplicably” limited deliveries to 4,000 gallons.

GAO sided with the government agency.  They said that although the offer initially conformed to the terms of the solicitation (because the initial reference to 7,500-gallon deliveries was a “statement of capability”) when Bluehorse told the CO in the email that the offer was dependent on the ability to deliver 7,500 gallons at a time, Bluehorse had placed a condition on the acceptance of its quotation.

GAO said, “the record supports the agency’s conclusion the protester subsequently conditioned its quotation upon the ability to deliver a minimum of 7,500 gallons of fuel at a time.”

So the contractor tried to change the rules after the fact. It did not matter whether the government had the capacity to hold the amount Bluehorse wanted to provide. All that mattered was that the government wanted one thing, and Bluehorse insisted on providing another.  GAO denied the protest.

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